KPIT Technologies Ltd Directors Report.

Dear Members,

The Directors are pleased to present the Fifth Annual Report together with the Audited Accounts of the Company for the Financial Year ended March 31, 2022.

Performance of the Company

(In million)

Particulars Standalone 2021-22 Consolidated 2021-22
USD Rs USD Rs
Revenue from operations 159.42 11,809.88 328.35 24,323.86
Profit before Tax (PBT) 37.33 2,765.72 46.51 3,445.44
Profit after Tax (PAT) 32.14 2,381.20 37.29 2,762.43

Result of Operations

During the year under review, the total revenues from operations (consolidated) increased to f 24,323.86 million (previous year f 20,357.41 million), a growth of over 19.5% of the previous year. Earnings before interest, tax, depreciation and amortization was f 4,385.45 million on consolidated basis with growth of 41.4% over previous year. Net profit after tax (consolidated) increased by 87.79% to f 2,762.43 million (previous year f 1,471.03 million).

In US Dollar terms, revenues from operations for the year on consolidated basis was $ 328.35 million as against $ 274.77 million during the previous year, a growth of 19.5%. Average realization rate was f 74.08 per US Dollar.

Standalone sales for the financial year 2021-22 grew by 47.10% to reach f 11,809.88 (previous year f 8,028.48 million). Net profit after tax increased by 154.60% to f 2,381.20 (previous year f 935.26 million).

Dividend

During the year, the Board of Directors of the Company declared and paid Interim Dividend of f 1.25/- per equity share of face value of f 10/- each (at 12.50%). The Directors are also pleased to recommend a final dividend of f 1.85/- per equity share of face value of f 10/- each (at 18.50%) on the paid-up equity share capital of the Company for the year under review. The total payout for the final dividend will amount to f 849.84 million including dividend distribution tax.

The Company had amended its Dividend Distribution Policy by increasing the Annual Dividend Payout Ratio up to 35% in coming two to three years. The said Dividend Distribution Policy is uploaded on the website of the Company (https://www.kpit.com/ investors/#policies-reports-filings).

Awards & Recognition

From Clients

• KPIT won the ‘Indirect Souring Partner Supplier of the year award from one of its long-standing Tier-1 client.

• A European OEM in the premium car segment recognized KPIT as a ‘Software Integration Partner for AUTOSAR.

• Leading Commercial Vehicle OEM recognized KPIT as a trusted ‘Partner for Autonomous Simulation Technology in its journey towards Autonomous Driving.

From Partners and Industry Forums

• KPIT won the ‘Service Delivery Excellence of the Year 2021 Award by NASSCOM for two marquee engagements with leaders in Mobility in the areas of Electrification and Autonomous Driving.

- KPIT demonstrated service delivery excellence as a software technology partner to an Automotive OEM for Autonomous Driving.

This engagement powered OEM to launch the worlds first Level 3 autonomous vehicle. Scale, multiple SW components, partnerships powered this delivery that will extend up to 2030 on multiple vehicle programs.

- KPIT demonstrated service delivery excellence as a Software Tier-1 for the Charging Control Unit (CCU) program of a leading German OEM. In an exclusive arrangement the OEM, Tier-1 & KPIT have a triparty arrangement to deliver software variants for 11 carlines through a unique menu- based software delivery on-demand model, resulting in significant software re-use & cost benefits.

• Frost & Sullivan selected KPIT for the prestigious 2021 Global Over-the-air (OTA) and Cloud Platform Technology Innovation Leadership Award.

• KPIT won the ‘Transformation Initiative in Treasury Management Award in the 4th edition of the Financial Leadership Awards organized by Kamikaze B2B Media.

• KPIT is recognized as a Leader in the Everest Group PEAK Matrix Assessment for Autonomous, Connected, Electric, and Shared (ACES) Mobility Automotive Engineering Services 2021.

KPIT achieved re-certification of Automotive SPICE Organizational Process Maturity Level 5 for its Pune and Bengaluru campuses.

• KSAR Classic - KPITs flagship AUTOSAR stack achieved ASIL-D Safety Certification.

• KPIT won the 1st prize for Workplace Excellence under the category of ‘Sustainability at the 6th edition of Workplace Excellence Awards by iNFRHA, Pune Chapter.

Quality, Productivity and Innovation

Delivering Zero Defects is one of our key strategies to achieve our Mission of becoming a leading software integration partner in mobility. To achieve this objective of ensuring zero defect delivery to our customers, we had designed a comprehensive quality framework covering key initiatives in the areas of People, Process and Technology with a focus on improving performance at Project/Program level, Practice level and Unit level. We took up key initiatives for the year from this framework, put a detailed plan for each, defined processes keeping sustenance and scalability in mind, improved it through pilots and then deployed across all projects through rigorous tracking and support. Initiatives that were deployed during the previous year were sustained through strong governance.

Katapult framework that was developed and deployed for code quality improvement, was enhanced to include test quality performance and deployed across all the projects. This has resulted in significant benefits to customer in terms of achieving product quality on a continuous basis.

Competency and Knowledge Management initiative, that was deployed across all projects during previous year was enhanced with a complete automated integrated system. The system will aid with a heatmap on skill gaps at project, practice, individual level and provides a mechanism to plan skill gap ramp down and track competency improvement. Migration to new system is in progress across all projects. This helps in improving competency at individual level, project level and practice level, thereby resulting better quality output to our customers.

To improve on quantitative management, the measurement system was enhanced with refinement to ‘First Time Right and ‘Zero Defect Delivery KPIs for better insight. Tools were enhanced to address this change and deployment is in progress across all projects. The focus is on achieving First Time Right mindset, which in turn will result in improving Zero Defect Delivery to our Customers. Project Management and Program Management trainings have been enhanced to drive this mindset.

For productivity improvement, tools and systems were put in place to measure and track productivity at individual level and at project level. To become competitive on tools cost and improve utilisation, standardisation was done on engineering tools at practice level.

All these initiatives helped us in driving zero defect delivery and resulted in exceeding the goal on CSAT rating from customer with a consistent higher coverage in all quarters during the year. This also resulted in downward trend on high-risk projects.

To sustain quality with our scalability, there is more dependence on our processes, tools and systems. Continuous improvement is our focus to achieve efficiency in our processes and to keep pace with new trends. These improvements come through learnings in the projects, feedback from customers and ideas from the employees. During the year, we took up many such improvements, upgraded our processes, and deployed across projects. The focus is on keeping the processes efficient and lean.

Our commitment to quality is improvised by our consistent endeavour in certifying ourselves to the best standards in the Industry. We continue to sharpen our quality focus through internal initiatives and by certifying against international standards. We underwent recertification assessment on Automotive SPICE and achieved Organisational Process Maturity Level 5, thereby continuing to hold this certification from 2007. We completed recertification audit on ISO9001. We achieved ASIL D for AUTOSAR Classis product. We continue to maintain our certification on Business Continuity Management (ISO 22301) and Information Security Management (ISO/IEC 27001).

Share Capital

The issued, subscribed and paid-up capital of the Company as on March 31, 2022 is Rs 2,741.43 million consisting of 274,143,80 8 equity shares of Rs 10/- each.

Institutional Shareholding

As on March 31, 2022, the total institutional shareholding in the Company was 28.31% to the total share capital.

ICRA Ratings

ICRA has assigned the (ICRA) A1+ as short-term rating and (ICRA) AA with the "Stable" outlook as the Longterm rating.

Information about the Subsidiary & Associate Companies

As on March 31, 2022, the Company had fourteen subsidiaries and three associate companies.

In accordance with Section 129(3) of the Companies Act, 2013, (hereinafter referred to as "the Act") the Company has prepared consolidated financial statements of the Company and all its subsidiary & associate companies, which forms a part of the Annual Report. A statement containing salient features of the financial statements of the subsidiary Companies in Form AOC-1 is annexed to this Report as "Annexure 1".

In accordance with Section 136(1) of the Act, the Annual Report of the Company, containing the standalone and the consolidated financial statements and all other documents required to be attached thereto have been placed on the website of the Company, www.kpit.com.

Further, a report on the highlights of performance of subsidiaries and their contribution to the overall performance of the Company has also been placed on the website of the Company. Ministry of Corporate Affairs (MCA), vide General Circular nos. 14/2020 dated April 8, 2020, 17/2020 dated April 13, 2020 and 02/2021 dated January 13, 2021 provided certain relaxations for companies, including conducting Extraordinary General Meeting (EGM) through Video Conferencing (VC) or through other audio - visual means (OAVM) for passing of special and ordinary resolution by Company on account of threat posed by COVID-19. Further, MCA vide General Circular 2/2022 dated May 5, 2022, & Securities and Exchange Board of India vide circular SEBI/HO/CFD/ CMD1/CIR/P/2020/79 dated May 12, 2020, SEBI/HO/ CFD/CMD2/CIR/P/2021/11 dated January 15, 2021 and SEBI/HO/CFD/CMD2/CIR/P/2022/62 dated May 13, 2022, has extended these relaxations to Annual General Meeting of companies to be conducted during the calendar year 2022. The members interested in obtaining a soft copies of the audited annual accounts of the Company and its subsidiary companies may visit investor section on website of the Company www.kpit.com.

Directors

In accordance with Section 152 of the Act, Mr. S. B. (Ravi) Pandit retires by rotation at the ensuing annual general meeting and being eligible, offers himself for re-appointment. The Board recommends his re-appointment.

Mr. Anup Sable has been appointed as an Additional & Executive Director (Whole-time Director) with effect from December 22, 2021 who, shall hold office upto the date of the ensuing annual general meeting. A resolution is being put up for the approval of the shareholders at the ensuing annual general meeting for his appointment.

Mr. Chinmay Pandit has been appointed as an Additional & Executive Director (Whole-time Director) with effect from July 26, 2022 who, shall hold office upto the date of the ensuing annual general meeting.

A resolution is being put up for the approval of the shareholders at the ensuing annual general meeting for his appointment.

Ms. Bhavna Doshi and Prof. Rajiv Lal were appointed as an Additional & Independent Directors of the Company with effect from September 15, 2021 and November 1, 2021 respectively who, shall hold office upto the date of the ensuing annual general meeting. The resolutions are being put up for the approval of the shareholders at the ensuing annual general meeting for their appointments.

Due to the urgent personal pressing engagements, Ms. Shubhalakshmi Panse has resigned from the post of directorship of the Company with effect from June 17, 2021. The Board places on record its appreciation for valuable services provided by Ms. Panse during her tenure.

Independence of the Board

The Board of Directors of the Company comprises of optimum number of Independent Directors. In the opinion of the Board, the independent directors possess integrity, expertise and experience (including the proficiency). Based on the confirmation/disclosures received from the Directors and on evaluation of the relationships disclosed, the following Non-Executive Directors are Independent in terms of Regulation 16(1) (b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Section 149(6) of the Act:

1. Mr. Anant Talaulicar

2. Mr. B V R Subbu

3. Prof. Alberto Sangiovanni VincenteUi

4. Dr. Nickhil Jakatdar

5. Ms. Bhavna Doshi

6. Prof. Rajiv Lal

Key Managerial Personnel

The following persons have been designated as Key Managerial Personnel of the Company pursuant to Sections 2(51) and 203 of the Act, read with the Rules framed there under:

1. Mr. Kishor Patil - Chief Executive Officer (CEO) and Managing Director;

2. Ms. Priyamvada Hardikar - Chief Financial Officer;

3. Ms. Nida Deshpande - Company Secretary.

Board Meetings

Ten meetings of the Board of Directors were held during the year. More details about the meetings are available in the Report on Corporate Governance, which forms a part of this Annual Report.

Committees of Board

The details regarding the Committees of the Board of Directors of the Company are given in the report on Corporate Governance, which forms a part of this Annual Report.

Companys Policy on Directors appointment and compensation

The Nomination and Remuneration Policy of the Company provides roles and responsibilities of the Nomination and Remuneration (HR) Committee and the criteria for evaluation of the Board and compensation of the Directors and senior management. Further, as per the policy, the said Committee shall identify potential candidates for becoming members of the Board and determining the composition of the Board based on the need and requirements of the Company from time to time to bring out diversity in the Board and also identify persons to be recruited in the senior management of the Company and ensure the Companies compensation packages and other human resource practices are effective in maintaining a competent workforce and make recommendations relating thereto. Pursuant to the provisions of Section 134(3) (e) of the Act, the said policy of the Company on the appointment and compensation of Directors including criteria for determining qualifications, positive attributes, independence of a director and other matters provided under Section 178(3) of the Act is available on Companys website at the link: https:// www.kpit.com/investors/#policies-reports-filings

Audit Committee Recommendations

During the year, all the recommendations of the Audit Committee were accepted by the Board. The composition of the Audit Committee is as mentioned in the Report on Corporate Governance, which forms a part of this Annual Report.

Corporate Social Responsibility

KPITs Corporate Social Responsibility ("CSR") is aligned to have a stronger commitment towards the community. KPIT demonstrate its commitment across all the regions of KPITs global presence. It also aims to create long-lasting impact across the focus areas of education, environment and employee engagement. KPIT firmly believe, through technology and innovation, KPIT can add significant values to the communities worldwide. The Company had constituted a Corporate Social Responsibility (CSR) Committee and has framed the Policy on Corporate Social Responsibility as per the provisions of section 135 of the Companies Act, 2013 and Companies (Corporate Social Responsibility Policy) Rules, 2014. The CSR Policy including annual action plan is available on Companys website at the link: https:// www.kpit.com/investors/#policies-reports-filings The initiatives taken by the Company on CSR during the year as per the said rules has been annexed to this Report as "Annexure 5".

Vigil mechanism/whistle blower policy

The Company has established a vigil mechanism/ whistle blower policy as per Regulation 22 of the SEBI (LODR) Regulations, 2015 for Directors and employees to report their genuine concerns. The details of the same are explained in the Report on Corporate Governance. The Policy on Vigil Mechanism & whistle blower may be accessed on the Companys website at the link: https://www.kpit.com/investors/#policies- reports-filings.

Auditors

Pursuant to the provisions of Section 139(1) of the Act, read with the Companies (Audit and Auditors) Rules, 2014, M/s. B S R & Co. LLP, Chartered Accountants, were appointed as the Statutory Auditors of the Company in the Annual General Meeting held on August 29, 2018 for a period of five years.

The Notes on financial statements referred to in the Auditors Report are self-explanatory and do not call for any further comments. The report does not contain any qualification, reservation or adverse remark.

The Board of Directors of the Company appointed Dr. K. R. Chandratre, Practicing Company Secretary, as the Secretarial Auditor to conduct audit for the year under review. The Secretarial Auditors report for the year under review is annexed to this Report as "Annexure 6". The report does not contain any qualification, reservation or adverse remark.

Internal Control Systems and Adequacy of Internal Financial Controls

The internal control systems of the Company are adequate considering the nature of its business, size and complexity. The Statutory Auditors of the Company have expressed their opinion on adequacy of internal financial controls with reference to financial statements for the year under review and operating effectiveness of such controls.

Corporate Governance

A separate section on Corporate Governance with a detailed compliance report thereon forms a part of this Report. The Auditors Certificate in respect of compliance with the provisions concerning Corporate Governance, forms a part of this Annual Report, as required under the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as "the SEBI (LODR) Regulations, 2015").

Management Discussion and Analysis

A Management Discussion and Analysis Report giving detailed information on operations, performance and future outlook of the Company and its business forms a part of this Report.

Particulars of Employees

A statement containing the names of every employee employed throughout the financial year and in receipt of remuneration of f 1 crore 2 lakhs or more, or employed for part of the year and in receipt of f 8.5 lakh or more a month, and other employees as required under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is annexed to this Report as "Annexure 3 (a)".

The ratio of the remuneration of each director to the median employees remuneration and other details prescribed in Section 197(12) of the Act, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are annexed to this Report as "Annexure 3 (b)".

Employees Stock Option Schemes (ESOSs)

In compliance with Regulation 14 of the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014, information relating to ESOSs of the Company is annexed to this Report as "Annexure 4".

Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company has a policy on prevention of sexual harassment at workplace and has put in place a redressal mechanism for resolving complaints received with respect to sexual harassment and discriminatory employment practices for all genders. The Company has constituted Internal Complaints Committee which is responsible for redressal of complaints related to sexual harassment. During the year under review, no case was filed with the POSH committee. Thus, there were no complaints pending as on March 31, 2022.

The Company has taken various measures to create awareness amongst employees such as sending emails and communication to all employees, conducted awareness sessions with new joiners and deploying e-learning module for all KPIT Employees etc. for prevention of Sexual Harassment of Women at Workplace.

Details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 during the year along with their status.

The Company has not made any application under the Insolvency and Bankruptcy Code, 2016 during the financial year 2021-22.

Details of difference between amount of the valuation done at the time of one-time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof.

The provision regarding difference between amount of the valuation done at the time of one-time settlement and the valuation done while taking loan from the Banks or Financial Institutions is not applicable to the Company during the financial year 2021-22.

Fixed Deposits

The Company has not accepted any deposits as on March 31, 2022.

Information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Act, read with Rule 8 of the Companies (Accounts) Rules, 2014

Conservation of Energy

Energy conservation has always been a focus of KPIT. HVAC consumes around 50% of energy, hence focus was on HVAC operations to maximize efficiency.

Having efficient HVAC VRF system gives more efficiency and flexibility to control smaller areas as per operational requirement. Due to COVID-19 Pandemic conditions, most of the employees were continued working from home hence there was low occupancy in office therefore, new process and practices were implemented such as AC temperature settings, monitoring of AC system w.r.t occupancy, cross ventilation and max air changes, seasonal temperature setting for ACs, shutting down unused lights and equipment with rigorous monitoring, regular monitoring of consumption and taking measures, monitoring meeting room, discussion rooms lights and AC working.

An open car parking lot of more than 8,000 sq. meters was converted into solar power parking lot with an object to generate green energy and which also overcome the leading concerns of heating vehicles in summers.

The solar power parking lot providing double benefits as to cover 240 four wheelers and 350 two wheelers and capacity of generating energy upto 661.65 kWp which is indented to produce 960 thousand Units of power annually. 75% of the energy requirement of the sunny hours is fulfilled by solar plant and 47% of overall consumption is generated through solar energy. The said plant was commissioned in the month of August 2021. The plant was setup through BOT with zero capex investment and will save around Rs 30 lacs annually. No capital investment on energy conservation was made by the Company in FY 2021-22.

During the year under review, KPIT continues with its commitment for greener world and has successfully covered around 4 acres of land as green belt with plantation of 1,333 native trees, shrubs and flowering plants which has increased the freshwater requirements.

In FY 2021-22, as some of the employees have resumed office, there was a marginal increase in consumption of power by 18% due to usage of hardware as well as there was an increase in water consumption around 44% as compared to previous financial year where all the employees were working from home.

Green Initiatives

The following initiatives were undertaken at the Company level to create awareness about importance of environmental protection and reducing pollution:

• In the state of Maharashtra, the Koyna-Chandoli corridor has been a host of KPITs afforestation efforts in association with the Wildlife Research & Conservation Society (WRCS). Continuing our previous years efforts, we aligned our afforestation activities with the onset of monsoon. Due to the COVID-19 pandemic, our volunteers have not been able to participate physically in the plantation activities this year. With the help of local villagers and full-time activists of WRCS, we planted a total of 3,000 saplings. With this, a cumulative of 48,900 saplings were planted in an area of 252 acres with an overall survival rate of 80 percent.

• Staying true to our commitment towards a cleaner world, we at KPIT observed Environment month and inspired all the KPITians to take steps towards environment protection from the comfort of their homes (considering COVID-19 restrictions) and by following eco-friendly practices. Events included various talks and workshops on Upcycling plastic, Home composting, Terrace gardening and Toxic free lifestyle.

• To create awareness about eco-friendly lifestyle, KPIT organized workshops on Eco-friendly Ganesha making and Handmade Diwali lanterns. We also invited guest speakers to talk on COVID-19 impact on wildlife, Understanding rivers & floods, effects of air pollution and SWACHH BHARAT.

• Mr. Anup Sable, Board Member of KPIT inaugurated and handed over a drinking water well to villagers of Vatunde-Nigadimal in Dhangar Vasti, about 60 km from Pune. Construction of this well started last year. This well is created to help about 100 beneficiaries. Going forward, they shall no longer be required to fetch water from long distances and will always have easy access to clean drinking water.

• KPIT collaborated with 14 Trees Foundation (14TF) and Ecological Society, Pune for building sustainable, carbon-footprint-neutral ecosystems through reforestation. Efforts are being made to restore uncultivable barren land at the 14TF Vetale site, near Rajguru Nagar (60km from Pune) with native species like mango, banyan, neem, jamun, umber etc. This has also created employment for the locals. With the help of local villagers and full-time activists of 14TF, KPIT planted a total of 632 saplings.

Our Chairman, Mr. S. B. (Ravi) Pandit along with his family visited this project during monsoon.

He appreciated and encouraged efforts of 14TF team towards protection of the environment and towards generating structured livelihood for the locals. KPIT has also inspired its clients to be part of the afforestation efforts. Supporting these efforts, KPIT along with a few celebrated their work anniversaries by planting the no. of trees equivalent to their years of partnership.

KPITians from the Pune office participated in the ongoing Mula river cleaning activity at Aundh in association with our NGO partner, Jeevitnadi-Living River Foundation. It was an early morning activity with a lot of hard but satisfying work. They cleaned the riverbank, collected, and segregated garbage. They also indulged in bird watching and observed nature to the fullest. Employees with their family members enjoyed the activity.

Occupational Health and Safety Assessment Series (OHSAS)

KPIT had a robust annual calendar with a wide range of activities for ensuring health and wellbeing of our employees. The programs were carried in all geographies where KPITians work in collaboration with our wellness partners. The following activities were carried out by the Company for ensuring health and safety of our employees in the year 2021-22.

• Wellness calendar with focus on nutrition, wellness, stress management, infectious disease prevention, mental health, childcare, pain management, meditation, e.g., ‘Diet for Boosting Immunity, ‘Relaxation Techniques for Emotional Wellbeing, ‘Behavioral Ways to Cope-up with Anxiety, etc.

• Extensive webinars on COVID-19 Prevention and Precautions.

• Live virtual Health Studio with doctors and teleconsultation, exclusively for women of KPIT.

• Specially organized Financial Wellbeing Webinar along with consultation.

• Dedicated 2 full months of yoga sessions for senior management on the occasion of International Yoga Day.

• For better mental health & emotional intelligence, a webinar- ‘Connecting in a Crisis For Better Wellbeing & Joy that explained how our connections have a deep impact on our overall wellbeing and happiness.

• 73rd Republic Day celebrated with flag hoisting, funtakshari and Bharat Quiz, organized for employees along with their family and friends.

• Engagement through Talent Show and Quiz Competitions. Post lockdown, celebrated Childrens Day by inviting all employees with their families to Childrens Carnival - an offline event at KPIT Pune & Bangalore office. (All COVID-19 guidelines were thoroughly followed.)

• A full week dedicated to womens health through webinars, Zumba sessions, Diet & Nutrition, selfdefense, meditation, healthy relationships, etc.

Specific preventive measures taken for safety of employees during COVID-19 pandemic:

• KPIT partnered with various Hospitals for providing Covishield vaccination to 1,900 KPITians and 1,100 immediate family members.

• KPIT have also facilitated to get parents/in-laws vaccinated on discounted payment basis.

• General physician and counsellor are available for any medical consultation or counselling for KPITian or anyone of family member.

• Cab shuttle service from KPITs Hinjawadi Phase 3 office, Pune to KPITs Hinjawadi Phase 2 office, Pune during evening.

• Implemented 96% Work From Home (WFH) to reduce risk of spread of COVID-19.

• Weekly COVID-19/RTPCR tests from renowned lab for all employees and 3rd party staff.

• Vaccination mandatory for all above 45 years. Temperature monitoring was done by keeping the air-conditioning at more than 25 degrees in Pune and 23 degrees in Bengaluru Office.

• Sanitizers were kept at all common places.

• Alternate wash basin and Urinal are closed to maintain distancing in washrooms.

• Daily windows are kept open for one hour before and after office hours for cross ventilation.

• Formed cross functional team across the globe for safety, well-being and communication.

• Deep cleaning and sanitization of office premises including increased frequency of cleaning - all touch points like doorknobs, switches etc. throughout the day.

• Wearing mask made mandatory for everyone in the office and for all third-party staff, face masks and gloves were mandatory in the week leading to the lockdown.

• Operations are being resumed with limited employees in staggered manner.

• Social distancing measures at all times from commuting, office work, cafeteria, and reduced the number of chairs in the cafeteria. Only 4 people could sit on one table initially and later only 2 people were seated on a table meant for 6. Face to Face seating was discontinued.

• Personal hygiene and Safety First being followed all the time.

• Temperature checks and Status checks on Aarogya Setu app mandatory at office entry points.

• All doors including that of ODCs were kept open to reduce the touch points.

• Restricted use of elevator and only stairs to be allowed.

• Restrictions on use of Gym, recreation and resting rooms as per directions of the government.

• Recommended QR code-based payments in cafeteria.

• COVID warrior at every floor to oversee enforcement.

• Continuous awareness among employees through leadership videos, myWorld banners and communication.

Technology Absorption

During the year under review, multiple technological improvement initiatives were rolled out. These initiatives helped to improve the systems and applications performance and reduction of cost.

H Business Continuity Planning (BCP) - Enabling Secured WFH

Given the unprecedented nature of COVID-19 crisis, KPIT is vigilant and working towards anticipating and planning for various scenarios. Business Continuity Planning team will keep track, assess incidents and work with client teams to build and execute specific plans.

Objectives of BCP:

• Implementing a set of measures for avoiding possible failures.

• Prioritization of Key services and providing for alternate service delivery.

• Educating the users of their responsibility before, during and after the business interruptions.

• Providing an orderly and efficient transition from normal to emergency condition and back to normal maintaining consistency in action.

• Readiness for hybrid working:

Uniform security checks / controls / policies for employees working from home or office.

Solution: Secure Work from Home (BCP) Enablement

Considering secure & successful working from home module, KPIT has created solution considering highly trusted technologies, Process & People framework.

As the remote working process got matured, multiple security tools and controls were introduced to cover the modern attack vectors.

Access to KPIT network over Next Generation Firewall Global Protect IPSec VPN:

• Secure Access through multifactor authentication overactive directory credentials to ensure access by an authorized individual only.

• Before granting access - Validating KPIT systems with HIPS for Security Certificate, Antivirus, Anti threat protections.

• KPIT Laptops with hardened OS & with latest security patches.

• Virtual desktop infrastructure in applicable scenarios with hardened OS images with latest security patches and controls.

• Endpoint protection using McAfee endpoint protection to detect and prohibit suspicious or malicious activity.

• Endpoint ATP using advance threat and anti-exploit protection.

• Endpoint Device DLP for threat monitoring, logging, and restriction on USB storage ports.

• Data exchange over end-to-end encryption with IPSEC tunnel from endpoint till secure gateway.

• Web-content filtering to protect against web malware.

• Collaboration using Microsoft Teams, Cisco WebEx.

Remote working environment enhancements

During the year under review, remote working environment was further strengthened with below points:

• MFA (Multi Factor Authentication) enabled for published applications.

• Deep packet inspection in effect for all the published applications.

• Enhanced web content filtering solution deployed to arrest new age threats.

• Remote security updates and patch management deployment further enhanced covering all corporate assets.

• Data Encryption enabled for all the critical end points.

• Capacity enhancements completed for additional virtual desktops for rapidly growing development and engineering teams.

Process and Policy controls for BCP:

• Strict adherence to KPIT Information Security Policy.

• User acceptance of Work from Home undertaking.

• Re-iteration of individual roles and responsibilities by Delivery Management.

• Setting up of BCP Command center.

- Open-Source Platform enhancements

During the year under review, KPIT has further enhanced state of the art open-source platform to OKD 4.8 (OpenShifts Open-Source Community Distribution) to cater to all the CI/CD pipeline. Platform is based on Kubernetes and it is architecturally highly available, auto scalable Open- Source Platform for Digital Technologies. To cater the need of data services, we deployed highly available open-source database clusters of MongoDB, PostgreSQL, and Percona XtraDB for MySQL. With zero surprises, all the corporate applications and data is migrated from an Enterprise Platform to new Opensource Platform. This helped organization in saving considerable yearly subscription cost.

Solution and Technology Deployed:

Considering hefty year on year subscription cost, KPIT decided to explore Open-Source option for an Enterprise Platform which was already in use. Identifying & creating a robust open-source platform without compromising features provided by earlier platform was difficult task. Also, it was not related to setting up a robust platform alone but building capability to support open-source technology was very critical. DevOps Team effectively took this challenge by deploying highly available and scalable OKD 4.5 on Fedora CoreOS with Kubernetes at its heart. DEV Team recoded all the applications and seamlessly migrated to the new platform with zero surprises. End user experience with applications running on new platform is further enhanced.

- Virtual Platform for Vehicle simulation & Validation

One of the key challenges faced in ADAS and AD development is Verification and Validation. Given the safety- critical nature of ADAS/AD, its important to ensure high levels of accuracy for this. This is where Virtual Simulation for Validation comes into play.

Solution and Technology deployed:

Deployed highly resilient Kubernetes platform along with KAFKA clusters with Kerberos. The solution has built in load balancer for optimum workload distribution. This platform contains Jenkins for CI/CD which allows continues delivery cycle.

- Smart Campus Platform

KPIT has begun the Smart Campus initiative and rolled out various "Smart Applications" for Employees. These applications were aimed at changing the user experience while optimizing the energy consumption. KPIT has pursued this initiative further and taken it to the next level by deploying "Smart Campus" platform and has integrated fourteen different systems and sensor driven devices that come under the aegis of Building Management System (BMS). Traditionally all these BMS systems such as Access control, CCTv, Fire alarm system and air-conditioning systems operate within their own silos and use legacy (often proprietary) protocols. The siloed approach leads to an absence of ability to conduct common monitoring and controlling.

Solution and Technology Deployed:

KPIT has brought in higher level of automation in all these 14 systems by use of various control panels and adaptors and have got them integrated to our platform. This has enabled the Company to provide accurate instantaneous reporting data of all these systems along with control functionality in a single dashboard. We are getting more visibility on electrical consumption across floors buildings, with clarity on which system is consuming how much electricity, how it can be effectively optimized. Automation in various pumps and Fan system gives more operational efficiency for the operations team and reduction in human errors along with reduction in electrical usage. Operations team is now better equipped to see all the systems in single dashboard. Because of instantaneous alerts mapped on various gateways (SMS/E-mail), they are now better equipped to manage various BMS systems effectively, this also helps them in taking care of employee safety at work.

- Hyper-Converged Infrastructure

KPIT is an early adopter of Hyper-converged infrastructure and reaping its benefits since last 2 years. In our pursuit of continual services optimization, Company has adopted Hyper-converged Infrastructure from all the three OEM solutions -HP, Nutanix Acropolis, Cisco HyperFlex and EMC vxRAIL.

Scaling out HCI cluster is helping us to suffice dynamic business requirements, quick customer on boarding & On the fly resource upgradation for deployed workloads. Inbuilt deduplication capabilities are helping us in effective storage management.

Solution and Technology Deployed:

KPIT was looking for an agile solution which will help us in making operations simpler, could be commissioned much faster, could be scaled on demand and could be effectively managed by skilling existing human resources.

Hyper-converged infrastructure addressed these issues. We could implement hyper-converged solution within a few hours. This infrastructure is helping us in adding capacity on demand, without vendor lockdown. Even achieving disaster Recovery (dR) is much simpler and it even supports multi-hypervisor environments. Besides easing datacenter migrations, Company do not have to make upfront investments now.

Following Environmental Returns are achieved: Hyperconverged Infrastructure has helped us in saving power, cooling and space by an additional 30%. We could also optimize the asset ratio from 7 to 1 for the same compute capacity in the datacenter. We continued investing into this technology last year too and the organization is reaping its benefits.

- Virtual Desktop Environment

Like majority of business organizations globally, KPIT also relies on its internal IT implementations to make processes more efficient, increase automation and deploy IT to make collaboration across geographies easier. The Company has deployed the most advanced technologies for its processes. These deployments are scalable and future ready to support changing work styles, information security criteria and the changing usage patterns of computing devices.

Solution: KPIT decided to shift from conventional desktop technology to Virtual Desktop Interface (VDI). Following operational aspects were considered while implementing the VDI solution: deliver on- demand services for users Increase IT efficiency, Simplify management, Ensure software compliance. Though KPIT was already evaluating a virtualization solution that was deployed in a limited environment, it had not explored the idea of transitioning the core ERP processes onto the virtualized environment but had transitioned only the less critical ones. Taking a step further toward optimizing energy requirement and consumption, KPIT decided to increase use of virtualization technology.

Solution and technology deployed:

HCI (Nutanix, CISCO, HPE) & VMware View based infrastructure platforms VMware Horizon View Virtual Desktop Infrastructure (VDI) Thin client

Following Environmental Returns were achieved after deployment of VDI:

1. Energy savings: More than 60% reduction in energy consumption was achieved by moving to the private cloud platform (including new technologies like hyper converged) with vdI as compared to using conventional computers. Cisco Unified Computing System, which is included as part of the private cloud platform, delivers high-memory capacity to support a large number of virtual machines on each blade server, thus reducing the amount of physical equipment to be powered and cooled. The desktop computers that consume around 150 watts of electricity, were replaced with very small devices called thin clients that consume just 30 watts. This has resulted in energy savings of approximately 3,00,000 units per year amounting to 375 MT of Co2 emission.

2. Reduction in e-waste: Almost 90% reduction in e-waste generation was achieved due to the increased IT hardware refreshment cycle for desktops, laptops and workstations. Lifespan of the above-mentioned hardware is about five years due to high resource requirement, capacity, and performance demand, and due to newer operating systems, application software and tools. Being a technology provider, it is extremely important for us to update our IT hardware platform and ready it for next generation development tools. The thin client on the other hand has more than eight years of lifespan. Till that time, it does not require upgrades or replacement as all the resources such as computing power, memory and disk space are accessed through VDI setup hosted in the datacenter. Under this infrastructure, we deployed 600 VDIs for the business users.

3. Reduced IT Asset Ratio from 1.20:1 to 1.10:1: VDI environment enables multiple users to access their accounts using a single machine without compromising on the security aspect. Before deploying the virtual desktop environment, the asset-to-employee ratio was 1.20:1. This meant that much of the IT infrastructure was underutilized and was consuming more natural resources. After the deployment of the Private Cloud platform with VDI, the asset ratio has reduced to 1.10:1 thereby reducing the computer hardware consumption by 10%.

4. Workplace utilization increased by 10%: The VDI helped in improving the utilization and flexibility of IT assets. Users can access their desktop, applications and data from any location, without compromising on the security of the system. In addition, employees can connect to corporate resources using any of the personal devices like iPads, Windows and Android based mobiles, thus enabling Consumerization of IT. This has led to workplace flexibility and optimal utilization of workspaces.

5. Reduction in travel across locations: KPIT has deployed best of the solutions such as Cisco Telepresence (Audio/Video conferencing) & Microsoft Teams across the offices and Cisco WebEx for better collaborations. With these solutions, our users can have conference meetings from anywhere and through any device. Even our business reviews, recruitment and customer meeting are conducted using these technologies. It has been observed that overall business travels across the globe has reduced by 25%. As this is a unified collaboration platform, end user productivity is also substantially improved. This solution hugely enabled remote collaborations during COVID-19 in big way.

Research and Development (R&D) Activity

During current year, the Company has not claimed any weighted deduction under section 35(2AB) of Income Tax Act 1961 for in-house R&D expenditure, as the same is not available with effect from April 1, 2020.

Foreign Exchange Earnings and Outgo

Total foreign exchange earnings during the year have been f 11,035.68 million (previous year f 6,993.48 million) and foreign exchange outgo (including imports) has been f 87.25 million (previous year f 166.86 million).

Particulars of loans, guarantees or investments under Section 186 of the Act

Particulars of loans, guarantees or investments made during the year under review, pursuant to the provisions of Section 186 of the Act are as below:

Sr. No. Name of the subsidiary Nature of transaction Duration Rate of Interest (%) Amount (in million) Purpose
1 ThaigerTec Co. Ltd. Investment in subsidiary NA NA 0.12 This is consequent to the transfer of investment from a wholly owned subsidiary, KPIT Technologies Pte Limited, Singapore.
2 PathPartner Technology Private Limited Investment in subsidiary NA NA 890.00 Acquisition of controlling stake.
3 PathPartner Interior Sensing Private Limited * Investment in subsidiary NA NA 2.52 This is consequent to the acquisition of controlling stake in PathPartner Technology Private Limited.

* Divested with effect from April 1, 2022.

Particulars of contracts or arrangements with related parties referred to in Section 188(1) of the Act

Pursuant to the provisions of Section 134(3)(h) of the Act, the particulars of contracts or arrangements with related parties referred to in Section 188(1) of the Act and prescribed in Form AOC-2 of Companies (Accounts) Rules, 2014, is annexed to this Report as "Annexure 2".

Update on Merger & Acquisition

During the year under review, on June 15, 2021, the Company has received approval from Honble Mumbai Bench of National Company Law Tribunal approving the scheme of merger by absorption of Impact Automotive Solutions Limited, a wholly owned subsidiary, with KPIT Technologies Limited and their respective shareholders with an appointed date of April 1, 2019. As defined in the Scheme, it became effective on June 22, 2021 by filing the said order with Registrar of Companies.

During the year under review, the Company had entered into an agreement with PathPartner Technology Private Limited ("PathPartner"), an entity based in Bengaluru and its promoters for acquiring majority stake in PathPartner.

Further, on September 22, 2021, the Board of Directors has approved to purchase 25% shareholding in Future Mobility Solutions GmbH (‘FMS). Over a period of three years, KPIT will acquire the balance shareholding. Majority shareholding is expected to be acquired in the last quarter of the Financial Year 2022-23.

Material changes and commitments affecting the financial position of the Company

During this period of global crisis, our priority was to ensure the safety and wellbeing of our employees while helping our customers maintain seamless business service continuity. The Company scaled up fast to adopt social distancing norms, adopting new policies and restricting travel while enabling remote working for our associates.

We enabled multilevel communication with clients, backed by a technology engagement plan covering detailed steps across various aspects of each program. We helped clients with their BCP, anticipating challenges in their business while addressing them with technological solutions. Customers have appreciated the swiftness of our response, quality control, data protection and the level of support to ensure business continuity.

Parallelly, the safety of our employees and their families is of paramount importance to us. KPIT partnered with various Hospitals for providing vaccination to KPITians and their immediate family members. We also facilitated to get parents/in-laws vaccinated on discounted payment basis. We are in constant communication with our teams across the globe for any assistance that they might need. We also prioritized the wellness of our associates for which various sessions such as consultation through doctors and psychologists, yoga trainer, talk with leading nutritionist etc. were conducted.

We are equipped to support the communities we serve and the ones our people inhabit. It is our commitment to help citizens live and work sustainably and confidently in an ever-changing digital landscape.

Significant and material orders

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Companys operations in future.

Enterprise Risk Management Policy

A policy to identify, assess, monitor and mitigate various risks to key business objectives of the Company is in place. A detailed information on Enterprise Risk Management is included in this Annual Report.

Annual Return

The Annual Return of the Company for the financial year 2020-21 in Form MGT-7 has been uploaded on website of the Company i.e. www.kpit.com.

Responsibility Statement of the Board of Directors

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors state that:

i) in the preparation of the annual accounts for the year ended March 31, 2022, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2022 and of the profit of the Company for the year ended March 31, 2022;

iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) the annual financial statements have been prepared on a going concern basis;

v) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively and

vi) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

CEO & CFO Certification

Certificate by Mr. Kishor PatiL, CEO & Managing Director and Ms. Priyamvada Hardikar, Chief Financial Officer, pursuant to the provisions of regulation 17(8) of the SEBI (LODR) Regulations, 2015, for the year under review was pLaced before the Board of Directors of the Company at its meeting held on April 27, 2022.

A copy of such certificate forms a part of the Report on Corporate Governance.

Cost Records

The Company is not required to maintain cost records under the provisions of Section 148(1) of the Companies Act, 2013.

Directors & Officers Insurance Policy

The Company has in place an insurance policy for its Directors & Officers with a quantum and coverage as approved by the Board.

Acknowledgments

We take this opportunity to thank all the shareholders of the Company for their continued support.

We thank our customers, vendors, investors and bankers for their continued support during the year. We place on record our appreciation of the contribution made by our employees at all levels. Our consistent growth was made possible by their hard work, soLidarity, co-operation and support.

We further thank the governments of various countries where we have our operations. We also thank the Government of India, particularly the Ministry of Communication and Information Technology, the Ministry of Commerce, the Ministry of Finance, the Ministry of Corporate Affairs, the Customs and Excise Departments, the Income Tax Department, the Reserve Bank of India, the State Governments, the Software Development Centers (SDCs)/SpeciaL Economic Zones (SEZs) - Bengaluru, Pune and aLL other government agencies for their support and Look forward for their continued support in future.

For and on behaLf of the Board of Directors
Pune S. B. (Ravi) Pandit
JuLy 26, 2022 Chairman of the Board